Indian students pursuing education abroad are eagerly anticipating the release of the Interim Budget for the fiscal year 2024–25. The release of the budget is scheduled for presentation in the Lok Sabha on February 1, 2024, by Finance Minister Nirmala Sitharaman. Moreover, the budget holds high expectations for various stakeholders.
Indian parents providing financial support to their children studying abroad is a significant aspect under scrutiny. To send money overseas, parents must adhere to the financial limits set by the Reserve Bank of India (RBI) through the Liberalised Remittance Scheme rules. As per these rules, parents can currently remit only up to USD 250,000 per financial year for their children’s education.
Furthermore, Tax Collected at Source (TCS) rules subject remittances abroad to additional complications. Since October 1, 2023, authorised dealers, banks, and money changers are mandated to levy TCS on transmitted funds, applicable to various purposes such as overseas investment, travel, medical needs, and international education.
However, anticipating the upcoming budget, stakeholders in the study abroad and international education sectors hope for a reduction or waiver in TCS specifically for funds remitted for overseas education and related activities. Such a revision would potentially yield a more positive outlook. The positive outlook will depend on whether a diminished or eliminated TCS could alleviate financial burdens on families. This will also strengthen a more conducive environment for an increased number of students to pursue education abroad.
